17. Jul, 2016

Do we really need China to deal with?

One word, NO!

One would think China was a super power and was running the world’s economy on a level equivalent to wall street (not that that is any measure) but the facts point out otherwise! Simply because there is a real ugly dark side to the rise of the Chinese economy or appearance of a rise.

China could be considered a Leninist state where a form of corrupt and crony capitalism exists. Real reform is a distant dream and is convoluted in a game of power and fiefdom still. True transparency (although non-existent everywhere) is flung aside in a model of powerful winners take all at any cost methodology. Like most very large emerging modern economies hundreds of millions are left behind while hundreds of millions chase a position in the new middle class (if you could call it that) and tens of millions chase the new money status as nouveau millionaires. But of course there is the state parasite, that hive of lice and flees taking as it wants or desires.

State ownership is still the largest of any in industry and when using the word ownership, I also mean management... there are at recent count 10M state managers running anything from Banking to Steel manufacturing. In many cases these entities are poorly managed and tend if anything to overproduce and have real returns of less than 2-3%...but size counts that is why there is an appearance of success. Of course there is a down side to this such as Ordos city, built very quickly for 1m people prior to the 2008 Olympic games. The Chinese thought they could show off ...but it was a shambles of poor and dangerous construction with buildings falling apart and roads and flyover collapsing killing hundreds at a time... it is being re built but still has trouble getting anyone to come and live there.

Chinas human rights leave little to be desired...one only has to look at the treatment of members of Falun Gong to see what is really wrong here. However, China has a long history of and still has a dreadful practice of simply detaining anyone for anything and not asking questions. Once gone many are never seen again and simply vanish into that area known as no man land. It is estimated that as many as 50000 people disappear each year in China

Chinas push into international waters is very worrying especially for Japan, the Philippines and Taiwan. These waters are international and if anything belong to Asean more than any single country and there in lays the reason for China's push and aggression. Although good for China Asean will bring the above 3 closer together and make it very difficult for the Chinese to keep a hold of groups of very very small islands such as the Spratleys. The trouble is once there and they already are they will claim that possession is 9/10 of the law. Even though the law (The Hague) has already said that China has no claim. On these waters being international it should also be noted that nearly 1/3 of the worlds current shipping runs through these waters and ownership gives great privilege and power to those in control as well as wealth. So why not build and control militarily what is of economic benefit...kind of like killing 2 birds with one stone!

Lastly China's exports are such crap! Just look at the current problem with building products and asbestos. It's not an isolated incidence. The Chinese themselves have had issues with many products made there such as powdered milk... there are no real number but it is estimated that 10000 children died from powdered milk products laced with melamine. Not too long back in Hebei there was a mass death of several thousands of workers from the manufacturing of glass wool batts. These workers died in a time frame as short as 3-5 years. Many poor Chinese from regional areas die each year from black lung through burning poorly manufactured coal bricks. Many of these products are exported with ISO certificates proudly produced by manufactures but whose authenticity is worthless. When was the last time you purchased a $2 Chinese product that worked properly and for a reasonable time? I recently purchased a $150 pram only to find out that it was both poorly made and dangerous... even though carrying a 12 month guarantee it was impossible to claim on as the base business was out of business and trading under another name.

China needs us more than we need them ... Yes, we should sell them Iron ore... but they don’t need coal and haven’t for a long time...they can produce more coal that they need. They choose to hold back their own resources... now that's smart. We allow them to have effect on our property market decreasing the chances of home ownership to younger Australians simply by the nature of their buying power. $150B alone in residential property in 5-6 years. But worst of all was our borrowing from China under the Rudd Government. That has locked Australia into a long term relationship that gives China a position of power. That power now translates into demands not to disallow larger foreign investment (in the Trillions of Dollars) and enter into political calls on things like the Spratley Islands. Of huge concern is our lessening of National security by way of sales of our Ports and Infrastructure.

Why does all this happen... STUPIDITY! and EGO...nothing more and nothing less. Our politicians want to be seen on the International stage making deals and turning wheels. What we as Australians need to remember is we vote these morons in to do stupid deals that cost us as nation ... everything!